Generation

Permissible municipal interests in generating units

95(1) No municipality and no subsidiary of a municipality may hold, directly or indirectly, an interest in a generating unit except in accordance with any or all of the provisions of this section and the regulations.

(2) If a municipality or a subsidiary of a municipality had an interest in a generating unit on May 1, 1995, that municipality or subsidiary may continue to hold that interest after May 1, 1995 if the generating capacity of the unit does not increase significantly beyond its capacity on that date.

(3) If

(a) a municipality had an interest in a generating unit on May 1, 1995, and

(b) a subsidiary of the municipality acquires the interest after May 1, 1995,

the municipality and the subsidiary are considered to be in compliance with subsection (2) if the generating capacity of the generating unit does not increase significantly beyond its capacity on May 1, 1995.

2003 Section 95 ELECTRIC UTILITIES ACT Chapter E-5.1

(4) The City of Medicine Hat or a subsidiary of the City may hold an interest in a generating unit if the generating capacity of that unit and all other generating units in which the City or a subsidiary of the City has an interest does not exceed the capacity that is needed to reliably meet the requirements of customers in the service area of the City.

(5) The Commission must determine whether

(a) a proposal by the City of Medicine Hat or a subsidiary of the City to hold an interest in a generating unit, or (b) an interest in a generating unit that is held by the City of

Medicine Hat or a subsidiary of the City is in accordance with subsection (4).

(6) Before making a determination under subsection (5), the Commission must obtain an independent assessment about whether the proposal to hold an interest in a generating unit or whether the interest in a generating unit is in accordance with subsection (4). (7) The City of Medicine Hat or a subsidiary of the City cannot acquire an interest in a generating unit under subsection (4) during any period that the City or a subsidiary of the City does not provide the information or statements required by a regulation made under section 142(1)(h).

(8) A municipality or a subsidiary of a municipality may hold an interest in a generating unit located within the boundaries of the municipality if the generating unit is part of a process that is carried out on property of which the municipality or subsidiary is the owner or tenant and the electric energy produced by the unit is incidental to the main purpose of that process.

(9) A municipality or a subsidiary of a municipality may hold an interest in a generating unit located within the boundaries of the municipality on property of which the municipality or subsidiary is the owner or tenant if a majority of the electric energy produced annually by the unit is used by the municipality or subsidiary on that property.

(10) A municipality or a subsidiary of a municipality may, with the authorization of the Minister, hold an interest in a generating unit if the arrangement under which the interest is held is structured in a manner that prevents any tax advantage, subsidy or financing advantage or any other direct or indirect benefit as a result of association with the municipality or subsidiary.

(11) The Minister must establish procedures to obtain an independent assessment about whether a proposal by a

municipality or a subsidiary of a municipality to hold an interest in a generating unit under subsection (10) is in accordance with that subsection.

(12) If the independent assessment concludes that a proposal by a municipality or a subsidiary of a municipality to hold an interest in a generating unit under subsection (10) is in accordance with that subsection, the Minister must give an authorization.

(13) The Minister may establish procedures to facilitate the resolution of any dispute under this section, except those dealt with by the Commission under subsections (4) to (6), about whether an interest or a proposed interest of a municipality or a subsidiary of a municipality in a generating unit is in accordance with this section. 2003 cE-5.1 s95;2007 cA-37.2 s82(4)

Continuation of power purchase arrangements

96(1) A power purchase arrangement continues to have effect in accordance with its terms and conditions, subject to this Act and the regulations.

(2) A power purchase arrangement held by the balancing pool administrator immediately before the coming into force of this section continues to be held by the Balancing Pool in the capacity of a buyer for all purposes of this Act, the regulations and the power purchase arrangement.

(3) A power purchase arrangement, other than a power purchase arrangement held by the Balancing Pool, that is terminated other than under section 15.2 of the power purchase arrangement

(a) is deemed to have been sold to the Balancing Pool, and (b) is to be held by the Balancing Pool in the capacity of a

buyer for all purposes of this Act, the regulations and the power purchase arrangement.

Termination of power purchase arrangement by the Balancing Pool

97 The Balancing Pool may, notwithstanding the terms and conditions of a power purchase arrangement held by the Balancing Pool under section 96(2) and (3), terminate the power purchase arrangement if the Balancing Pool

(a) consults with representatives of customers and the Minister about the reasonableness of the termination,

2003 Section 98 ELECTRIC UTILITIES ACT Chapter E-5.1

(b) gives to the owner of the generating unit to which the power purchase arrangement applies 6 months’ notice, or any shorter period agreed to by the owner, of its intention to terminate, and

(c) pays the owner or ensures that the owner receives an amount equal to the remaining closing net book value of the

generating unit, determined in accordance with the power purchase arrangement, as if the generating unit had been destroyed, less any insurance proceeds.

Power purchase arrangement ceases to apply

98 A power purchase arrangement ceases to apply to a generating unit

(a) on the expiration of the power purchase arrangement in accordance with the unit effective term completion date specified in the power purchase arrangement,

(b) on the termination of the power purchase arrangement under section 15.2 of the power purchase arrangement, or

(c) on the termination of the power purchase arrangement by the Balancing Pool.

Regulations

99 The Minister may make regulations

(a) respecting the payment of an amount into the Balancing Pool by the owner of a generating unit that is

(i) constructed at a power plant, and

(ii) designed to use the facilities identified as associated facilities in Schedule A of a power purchase arrangement;

(b) respecting flare gas generating units, including specifying which provisions of this Act and the regulations do not apply to flare gas generating units and the information the owners or operators of a flare gas generating unit must provide to the Independent System Operator;

(b.1) respecting micro-generation generating units, including, without limitation, regulations

(ii) respecting the development, connection and operation of micro-generation generating units, and

(iii) specifying which provisions of this Act and the

regulations do not apply to micro-generation generating units;

(b.2) setting out circumstances, in addition to those set out in section 95, in which a municipality may hold an interest in a generating unit;

(b.3) respecting any matter relating to a municipality holding an interest in a generating unit, including providing for

approvals or other requirements necessary for a municipality to hold such an interest;

(c) respecting the eligibility of a person to hold a power purchase arrangement or a contract, agreement or arrangement derived from a power purchase arrangement and prohibiting a person from holding a power purchase arrangement or an agreement or arrangement derived from a power purchase arrangement;

(d) respecting the holding and sale of a power purchase arrangement or agreements or arrangements derived from a power purchase arrangement by the Balancing Pool; (e) respecting the deletion, suspension, addition or replacement

of one or more provisions of a power purchase arrangement when a power purchase arrangement is held by the

Balancing Pool;

(f) respecting the duty of an owner of a generating unit to which a power purchase arrangement applies to provide information, including confidential information, to the Balancing Pool for the purpose of the sale of that power purchase arrangement or an agreement or arrangement derived from that power purchase arrangement by the Balancing Pool;

(g) respecting the approval of the Commission of

decommissioning costs and the amounts to be collected from customers, or through a power purchase arrangement by the owner of a generating unit to which a power purchase arrangement applies, for the purpose of decommissioning the generating unit, including payment to be made to or to be received from the Balancing Pool;

2003 Section 100 ELECTRIC UTILITIES ACT Chapter E-5.1

(h) respecting the determination and treatment of isolated generating units, including the preparation of tariffs related to those units and who is to make or receive payments relating to those units;

(i) respecting the requirement for customer choice in areas not served by the interconnected electric system, including payments to be made to the Independent System Operator by retailers and owners of electric distribution systems in respect of those areas and customers;

(j) respecting the payments into or out of the Balancing Pool related to the Small Power Research and Development Act; (k) respecting the amendment of Alberta Regulation

AR 175/2000 in order to continue a power purchase

arrangement that applies to more than one generating unit as power purchase arrangements that will apply to one or more of those generating units.

2003 cE-5.1 s99;2007 cA-37.2 s82(4)

Part 7